We had the opportunity to sit down with Frank Giustra last week, the lion behind Lionsgate Films, and an early architect of countless resource companies---most notably Wheaton River Minerals (now known as the $33B Goldcorp, which spun out the $12B Silver Wheaton), Petro Rubiales (now the $7B Pacific Rubiales), and Urasia Energy.
By all accounts Giustra is brilliant, connected and wealthy. He made headlines in 2007 by pledging over $100 million and half of his future earnings to establish a charitable foundation with President Clinton. Outside of philanthropy however, Giustra has been reluctant to draw attention to himself, and rarely speaks publicly about investing.
In 2002 however, he moved heavily into gold and published, “A Tarnished Dollar Will Put the Shine on Gold”, when it was trading under $300 an ounce. Ten years later and with gold now priced over $1600/oz., it still occupies the largest percentage of his investment portfolio, and his views remain the same.
In discussing gold during the interview he said, “I believe it’s going a lot higher...it's going to have a parabolic spike, caused by some event or some loss of confidence...a US dollar crisis would be a perfect example. That will cause gold to go through the roof, and then everybody will want to own it...I don't think we're even close to that yet...Gold will probably have a much greater run than some of the other hard assets--because it's also a currency.” (19:16)
On the subject of inflation he remarked, “It’s easier to make money with inflation than with deflation. All you need to make money with inflation is money...Those that influence policy are usually the ones that have access to money, or can borrow it very cheaply... They have a conflict of interest... [Inflation is] where a lot of people are getting rich, and the public is being educated—quote “educated” to accept that type of [inflationary outcome].” (11:10)
When asked about the parallels between today’s Western societies and previous civilizations, he replied that a strong example would be, “Sixteenth century Spain. In just over 100 years, it went from an almost nothing nation, to a great empire, and back to a nothing nation. They became a consumption economy...They waged a number of wars with almost everybody on the planet...because they felt they were a superior nation...[and] that’s what’s happening in America today...There’s no way out except currency debasement.” (15:30)
With respect to the mining shares, he said, “The resource market is in the worst state I've ever seen it in...people usually connect irrational and stupid market behavior with peaks of markets, but it takes place at the bottom of markets too. And it's just as bad [at bottoms]...fear is a much stronger emotion than greed...[There are] companies developing world-class assets trading at pennies on the dollar.” (21:50)
Additional topics discussed included agriculture, success, and mentorship (31:07).
Giustra’s predictions for the western world economies are sobering, but his view of the resource sector is optimistic, and his case for inflation is impossible to ignore. We feel this interview is required listening for all those who seek and desire wealth.
So without further comment, here is billionaire mining and entertainment mogul Frank Giustra in conversation at the Vancouver Club last week. Special thanks to Cambridge House and VC for putting us up, and to Frank for joining the program.
Join resource investment legends, analysts, and over 100 leading mineral exploration companies September 27-28, 2012 at the Sheraton Hotel Toronto for the Toronto Resource Investment Conference brought to you by Cambridge House International, the world leader in production of resource investment conferences. Early registration is free at CambridgeHouse.com.
We hope to see many of you there.
Great interview!
What an amazing man! After watching this video, I just became a big fan of Frank Giustra. Phenomenal grasp of how the world works, and how to profit from shifting economic tides. Thanks for bolstering my own belief in gold, and the inevitability of inflation. But what impressed me the most is his mentoring of young people. To use his brilliance in bettering the prospects of a troubled youth is philanthropy at its’ finest. Kudos, Mr. Giustra.
Became a fan of him, too. Never heard about him before, but I’m glad I stumbled upon this interview. He definitely has a story to tell.
BRILLIANT
excellent
BELIEVE !!!
Frank!!! Email me! I have these games for kids in your schools that teach the monetary system to kids. What you speak about here in your interview…kids can
learn in a fun easy game….8 year olds. My games are all hands on learning fun…in any language. My dream is to do what you are doing with your schools and also to do animal spay/neuter projects around the world. Kids that are kind to animals, and learn things that help them be financially literate. Don’t be afraid…email me. You would love my “Gold bug” game. Teachers would love it as it saves hours of drill and kill and the kids have fun!
let me know your contact details as interested in your money educational program for kids.
Frank Giustra demonstrates common sense, wide-ranging knowledge, and most of all penetratingly syllogistic analysis. Bluntly, one of the best interviews and articulated macroeconomic outlook I have recently heard.
Great interview. Thanks to Frank Giustra for taking the time and having the courage to do the interview. Given the span of the Internet, something like this is bound to leave many impressions and inspiration to many without the opportunity to be mentored by Frank.
Why is it that a very weathy person makes an wise investment is news? That is not news, because he did not risk much other than his excess. The guy that is news worthy is the little guy who risk what little saving his family had and bought gold and had the wisdom to sit upon it when others but the hundreds advised him to sell while it was at $400, $500, $650, it will never go highter at $800, your should have gotten out some time back when it fell back a bunch, sell now at $1100, It’ll never get to $1500 and still buying at $1690 and watched it drop yet again only now to begin to recover. And there are reporters that think gold is still going up. An oz. of Gold is the unit of measure, not the dollar, euro, pound they all are still going into the trash bucket. No one is more wealthy because the it takes more dollars to buy gold, or his home, or his toys.
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Well said and great video. As a provider of international due diligence services, we have seen a real rise in investors seeking physical assets and investments which will hedge against inflation and a falling US dollar. There’s no question there is not only safety in gold, silver and land and others, but there is significant profit potential. The Obama Administration has failed to address or even acknowledge the debt crisis, so unfortunately it seems the US and entire world is further at risk each day.
A great interview, wise words from a wise man. Every second is time invested well. I wrote about one key insight here, would love to hear your thoughts on it: http://moneyandblues.com/flight-plan/
Another great interview Tommy. You found a way to make Mr. Giustra feel relaxed and for him to pour an incredible amount of knowledge and experience into today’s decision making on investments.
There isn’t a better way to learn about what’s really happening on the ground at gold mines than listening directly to the CEOs themselves. The junior gold sector has been struggling recently. Brent Cook recently said on BSN that 80% of juniors won’t last the next decade, which I agree with. This is also echoed in the former Franco-Nevada COO’s interview I just read here: http://seekingalpha.com/article/1219881-exclusive-interview-with-pershing-gold-s-stephen-alfers
Powerful. Great interview Tommy.
Great interview! I’m excited to see Frank speak at the BCBusiness Top 100 Luncheon this year – http://www.bcbusiness.ca/people/the-bcbusiness-top-100-luncheon. Should be good…
Hi!, Patrons Of CEO CA Et Al:
We are always ON THE CUSP! The development of this realization in my opinion is when OUR Lord reminstrated more than 2,000 years ago: “Repent; for the kingdom of heaven is at hand!” Yes, with all the world chaos and confusion, still in the midst of it all is heaven being born, because we are each born to live in it forever and forever always begins right now! How long mankind can afford to escape living in heaven on Earth is a guesstimate isn’t it? How long can mankind outwit the will of God for heaven to be the way we live right here on Earth and that heaven is not some far and distant place somewehere else located out there in infinite space? The Jesus challenge will be realized in its’ own time and in its’ own way but nevertheless is has begun as He said as leven or seeds thrown along the wayside of life. Heaven is the center of every life and no matter what shape that life has taken in the past or is taking presently. We are heaven sent and heaen bound! Make absolutely NO mistake everyone reading this column but that heaven is every mans’ and womens’ true destiny. What do we think all the racial and other international problems are designed to teach everyone except heaven in OUR lives is always in demand? When men such as the one in this interview comes along to help US see the direction of OUR demand for more of heaven daily, we tend to honor him and place him above the views of others in our lives don’t we? Heaven in my mind is forever; while war and chaos are all short term evils that OUR Master and Lord asks US all to overcome with good. The more evil that seems to thwart heaven being dominant in OUR lives; the more good He asks US to create as the offset on OUR way to learning the way heaven really works for the good in OUR lives. Let US therefore remember Him as OUR Senior Brother/Savior and realize He meant every word he said in His Lord’s Prayer for ” thy kingdom come; and thy will be done on Earth as it is in Heaven!” We are well on OUR way and there is NO turning back for any of US is there? “BE STILL HE SAID AND KNOW THAT I AM GOD! PEACE; MY PEACE I LEAVE WITH YOU; NOT AS THE WORLD GIVES BUT A PEACE THAT PASSES ALL HUMAN UNDERSTANDING GIVE I UNTO ALL OF YOU!” We are His sheep and He is OUR Sheperd!
RUSS SMITH, CA. (One Of Our Broke Fiat Money States)
resmtih@wcisp.com